Easton inks first lease for proposed intermodal project

Deal with LANTA provides $7.2 million upfront to help finance $26 million venture.

February 27, 2013|By JD Malone, Of the Morning Call

At least one tenant for Easton's proposed intermodal center is signed for what passes for perpetuity these days — 99 years.

City Council approved a master lease Wednesday night for the yet-to-be-built intermodal, inking the Lehigh and Northampton Transportation Authority to a long-term deal in return for an upfront payment of $7.2 million. The lease with LANTA is through the city's parking authority, which in turn will operate the 370-space parking deck and bus terminal portion of the project.

LANTA's cash payment, derived from a federal transportation grant, is a major source of funding for the $26 million intermodal. Easton Mayor Sal Panto Jr. hopes to couple the LANTA money with grants obtained by the city to cut the amount the city must borrow to no more than $13 million.

Site work for the project started last year after the city demolished a Perkins restaurant and a movie theater on S. Third St. Construction could begin this summer.

Earlier this month, Panto recast the intermodal as a possible new headquarters for city government. The project calls for a three-story office building, part of which will be rented to LANTA and to the National High School Hall of Fame. Even with those leases, there is enough space to hold the 60 or so employees working in City Hall, which occupies several floors of the city-owned Alpha Building.

Panto said the city would sell the Alpha Building and use the proceeds to lower the cost of the intermodal. His administration believes the intermodal site would offer more efficient office space, lower utility bills and a more manageable piece of real estate.

City Administrator Glenn Steckman said at a previous meeting that handling tenant issues and attracting new tenants, as well grappling with the Alpha Building's aging structure, is not a core function of government.

Panto said three developers have approached him about the building, and he thinks it might be a good time to put the city's largest office building back in private hands.

The city struck a lease-to-purchase deal for the building in 1996, after it had sat vacant for five years. The city bought the building outright in 2001 for $4 million.

At its last meeting, City Council reviewed a preliminary financial analysis of moving City Hall to the intermodal and selling the Alpha Building, but members of council asked for more details and an in-depth review of the costs associated with such a move.

In other business Wednesday night, council approved a new banker for the city's accounts. The city selected Merchants Bank, of Bangor, as the city's new financial institution, replacing Lafayette Ambassador Bank. Seven local banks offered bids to the city.

Merchants Bank offered the highest rate of return on deposits, 0.30 percent, and will not charge monthly fees.

In a statement, the bank said it has donated $185,000 to community organizations in Easton and financed more than $20 million of revitalization projects in the city.